Opinion

Digital disruption hits recruitment at last

6 min read

10 April 2015

Digital technologies have had a game-changing impact on most industries across the UK. You don’t need to look further than organisations such as Uber and Airbnb to see how truly transformative technology has been to a wide range of industries. Yet there’s one industry that hasn’t seen much impact from technology, but is on the cusp of something great: recruitment.

For many years, the core of the recruitment model has remained untouched. Employers need to hire, but they have limited options. Either they advertise on job boards and wait for people who need a job to apply (often not the best people), or they ask a recruiter to find a candidate, but that comes with a significant fee. Whichever method is selected, the process is slow and expensive, with the average cost of recruiting a new hire at £15,000 and taking over 60 days. When more than half of permanent hires fail to live up to expectations, why hasn’t recruitment embraced full-scale change before? 

Disruption of age old business models

Uber is a great example of an organisation that clearly understands that holistic and total change of the economic model has the potential to achieve a massive and game-changing outcome with huge benefits for all participants. By inverting the taxi business model from large companies controlling the booking model to the drivers being liberated by technology themselves, they made a huge disruption within the transportation industry. 

This is in stark contrast to the bulk of disruption in recruitment, which has focused on taking parts of the traditional process and marginally improving them. In recruitment, the problem as a whole remains.

While small updates to procedural elements of recruiting were viewed as ground-breaking at their time, they have failed to deliver significant long-term benefits. For example, shifting recruiter CRM tools to cloud servers saw small cost reductions and minor efficiency improvements, but they weren’t revolutionary – they were more like putting a rolodex online.

Job boards were another attempt of disruption in recruitment and they did change the process of hiring, but fell short of true change. Job boards rose to prominence as they were a cost-effective way to reach candidates who are actively looking for a new job. The problem with this approach is that the best candidates are more often than not already employed and hence not looking on job boards. The burden of effort in the process lies with the employer too. 

Read more about disruption in the recruitment process:

By contrast, recruiters do most of the work and have several assets no one else does: fabulous candidate data, screening techniques and the ability to persuade a passive (already employed) candidate to consider a new job. That process comes with limitations though, not least high fees and habitual cold-calling due to the sales-focused business model.

Social recruitment, and LinkedIn in particular, is another great example of a step in the evolution of recruitment that again promised a lot, but did not bring true change. LinkedIn is fantastic for networking, but it misses the mark in recruitment due to the unqualified and superficial nature of the skills and experience on candidate profiles. Like the shift from offline to online CRM, this is still the same approach as the old model- instead of reading CVs on paper, you just read them online. You’re also left with the age-old problem of how to contact and engage a passive candidate and encourage them to consider leaving to work for you. It’s a specialised sell, and one that good recruiters spend careers refining.

Embracing true change in recruitment

Just like Uber revolutionised the transport industry, an Uber-like approach to hiring is what will give recruitment a much needed boost. Wholesale evolution leading to a faster, cheaper, more reliable mechanism for hiring will come by embracing marketplace economics and leveraging the power of data science and machine learning (systems that can make sense of vast volumes of data that were impossible until only recently) to quickly and easily identify the best candidates for specific jobs. 

Then the screening and “selling” the job to a candidate will be handled by experienced recruiters to save employers time and maximise the chance of a successful hire. This model will be the true paradigm shift in recruitment as it empowers the three stakeholders in all recruitment processes: the employer, the recruiter and the candidate.

We are only just beginning to see the possibilities afforded by the advancements in digital technologies in recruitment. The industry will continue to grow and companies will feel even more empowered to find great talent. Employees will know that their skills and qualifications are being appropriately matched to corresponding employment opportunities. That’s good news for companies given the pressures to attract and retain top talent are becoming even more challenging in today’s climate.

Ben Hutt is CEO of Talent Party.

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